starbucks4ever's Blog

Bottom call

starbucks4ever — Fri, 17 Dec 2010 11:28:59 GMT

This is an official bottom call for Treasuries. TLT is a buy.

TIP is a bargain!

starbucks4ever — Fri, 10 Dec 2010 12:43:45 GMT

Believe it or not, this treasury paper is a buy at the current price of 106 and a change. The government is always updating its methodology, which is why TIPS are not trading above par, but soon the reality of inflation will be so obvious that even the government will be forced to admit at least some of it. I think TIP is down because of the sell-off in the ordinary Treasury bonds, but that one will not last long...

Obama says congressional vote on the solar deal is vital

starbucks4ever — Thu, 09 Dec 2010 13:46:30 GMT

WASHINGTON (TMF) -- President Barack Obama says a congressional vote on the solar deal he negotiated with the Sun will determine whether the nation's economy "moves forward or backward."

The president again pressed Congress to pass the agreement, saying it has the potential to create millions of jobs. He said if it fails, Americans w...

That was the best joke from Bernanke ever

starbucks4ever — Wed, 08 Dec 2010 11:54:46 GMT

Confident that you can in theory raise rates in 15 minutes? So was Obama about his ability to repeal Bush's tax cuts for billionaires. How well did that play out?

It may well be, in fact, even likely that the recovery happens anyway regardless of political manipulations in Congress. The tripling of the money base by the unelected president, Ben Bernanke, amounts to a 30 trillion dollar stimulus, which would rejuvenate even a cadaver. And Obama is right when he says that middle-class taxes will not go up (aside from the inflation tax, to be sure). However, this is not what was promised. The promise was to ...

The Logic of a Liberal

starbucks4ever — Sun, 05 Dec 2010 12:17:48 GMT

Social Security income does not matter to the 250K-club, but health insurance expenses matter to them a great deal. And we are not talking about some very fancy insurance policy, but about a cheap and low-quality policy like Medicare. The same members of the club who realize they can't purchase such a policy from UNH feel at the same time that their Social Security income is chump change. Is there a problem with elementary logic?

The sideways market is over. We are entering the next stage - parabolic growth of a market already prohibitively expensive. The old strategies that worked throughout 2010 will not work any more. New and better solutions must be found.

Still bullish

starbucks4ever — Fri, 03 Dec 2010 00:57:23 GMT

Not calling the top yet, this rally looks like the real thing. 1300 is easily within reach...

Quatards go down the drain

starbucks4ever — Thu, 02 Dec 2010 18:14:16 GMT

Quatar is the biggest idiot this week, for winning the right to throw away $54 billion building stadiums and dismantling them - all that to let several teams of 22 men kick the ball for 90 minutes in year 2022.

Quatar must know the secret - how to concentrate the greatest amount of money in the smallest volume, and what constitutes the infrastructure of a soccer field. According to my calculation, $54 bi...

Beware of this advice, or why the "Crash JPM" scam will only crash the suckers who believe it

starbucks4ever — Wed, 01 Dec 2010 19:09:07 GMT

I have been busy not buying silver for years, and overall I've done well enough by not buying silver. I have been not buying silver for practical purposes - to protect a portion of my net worth from disappearing in this money-incinerating instrument when the supply of silverbugs runs out, but I never imagined that my not buying silver would be a part of a political or societal movement. And of course I could never imagine that my not buying silv...

Why doesn't Europe print its way out of the crisis?

starbucks4ever — Tue, 30 Nov 2010 19:26:39 GMT

The conventional wisdom is that Germans are too afraid of cranking up printing presses, having been burnt by hyperinflation in the 1920s, so they want stable money supply, while the PIIGS can only pay their debt by printing or defaulting. But if you forget the myth about stable Germany and look at the actual debt-to-gdp ratio, all of a sudden German debt doesn't look sustainable either. If the bond market decides to demand a higher yield, German...

Emerging markets' inflation

starbucks4ever — Mon, 29 Nov 2010 22:33:16 GMT

A new trend is in place: emerging markets all suffer horribly from food inflation, while the rich West hardly notices it at all. What's the matter?

To see why it's happening, consider two consumers: Sam and Janet (note: these names were chosen just to remain consistent with Krugm...

Putin wants to be paid in Euros?

starbucks4ever — Fri, 26 Nov 2010 19:03:34 GMT

Few leaders are eager to join the Eurozone nowdays, as the debt crisis casts doubt on survival of the currency union, but such candidates still exist. Today, the beleaguered Eurozone had to consider one particularly unlikely candidate: Putin.

Speaking at a conference in Germany the Russian prime minister, who is in the country for talks with Chancellor Angela Merke...

Idiot of the day: S&P

starbucks4ever — Wed, 24 Nov 2010 01:11:17 GMT

Interesting. So, during the whole last week, when Irish debt traded at 9% yield like a junk bond, the analysts from S&P believed that Irish debt deserved AA- rating. Then the news came that EU would bail out that bankrupt government. The financial geniuses from S&P thought about it and concluded that Irish bonds are now less safe than they were before the bailout announcement. I am wondering if anyone is still taking these clowns serious...

I think it's time to take a more bullish view.

starbucks4ever — Tue, 23 Nov 2010 17:20:56 GMT

We are approaching the S&P 1170 price level which I identified earlier as the most likely bottom for this pullback. I don't have a high confidence for this call. It's a low-confidence call as compared with my prediction of a bottom in September, but I will make it anyway. I think we'll get more "positive" news in December (positive for stock speculators, that is), enough good news to manage a Christmas rally. I understand those who...

Did Buffett just accept a bribe?

starbucks4ever — Thu, 18 Nov 2010 19:46:54 GMT

When I first read his op-ed in the Times, I was surprised by the sycophantic tone of his comments. He certainly didn't sound like the same WEB we used to know. If you read any of his previous articles and compare it with this latest piece, you might think they were written by two different people. (As a side note, I wouldn't be surprised to learn that were in fact written by two different people. Why have secretaries if you can't let them do som...

Idiot of the day: Warren Buffett

starbucks4ever — Thu, 18 Nov 2010 13:25:11 GMT

That was really stupid. To work 80 years for his stellar reputation - and to ruin it in one day with this article.
http://www.nytimes.com/2010/11/17/opinion/17buffett.html?ref=opinion

National leader improves transparency

starbucks4ever — Wed, 17 Nov 2010 16:38:12 GMT

One day after the $4 Billion scam at Transneft is revealed, Putin publicly thanks Transneft management, presumably to give people a clearer idea about who is covering up this theft. This is a welcome step that will help make corruption in Russia more transparent. Until now, he would ...

And now price controls

starbucks4ever — Wed, 17 Nov 2010 12:13:31 GMT

And now China is considering price controls. That's an act of desperation when interest rake hikes don't help and doing nothing won't help either. As a palliative measure it might help, but the reason they had to go back to the practices of Chairman Mao is that they never created a viable domestic market that can ignore price swings of rice because it's a minor expense. The bottom line: all mercantilist economies run at full speed into a concret...

Belly up

starbucks4ever — Tue, 16 Nov 2010 12:01:12 GMT

I've been predicting the crash of China for a while now, but the bubble has been refusing to burst. But fundamentals always win in the long run. Finally, this week, after a long period of irrationality, the first fishes floated belly up.
All of a sudden the media realized that:
-Company earnings are often fictitious
-There are many E...